The forestry and legume industries say the country’s two major railways prioritized other commodities over their shipments to the Port of Vancouver in the past couple months, costing companies millions amid surging demand for Canadian goods abroad.
Industry groups say Canadian National Railway Co. and Canadian Pacific Railway Ltd. imposed embargoes in the Vancouver area in November and December that hurt pulp and paper mills, sawmills and exporters of legumes such as dry beans and lentils. Embargoes temporarily stop or restrict traffic related to certain customers, goods or loading points and can cause missed shipments or backed-up supply chains.
Derek Nighbor, head of the Forest Products Association of Canada, is warning the railways against playing what he calls “commodity whack-a-mole.” He says three sets of embargoes on forestry products in Vancouver and nearby Squamish, B.C., marked the second year in a row of frequent stoppages, costing his sector $500 million in 2018.
Last week, the Canadian Transportation Agency launched an investigation into whether rail companies are fulfilling their obligations following industry complaints, with hearings set for next week.
In an email, CN acknowledged the recent congestion on the West Coast. It pointed to harsh weather and the complex supply chain that feeds into Canada’s busiest port.
CN and CP also cited record grain shipments and a busier port in recent months as global trade tensions work in Canada’s favour, with a Chinese tariff on U.S. soybeans and retaliatory European tariffs on U.S. corn spurring more Canadian exports.
Companies in this story: (TSX:CP, TSX:CNR)
The Canadian Press